More than 30 groups call for strong insurance industry data transparency in the wake of record insurance losses and multiple companies fleeing markets
WASHINGTON – As the sustained impacts of year-after-year of record setting hurricanes, fires, floods, and storms have caught up with the insurance industry, Public Citizen and X financial, consumer, and advocacy groups on Monday called on the White House’s Office of Management and Budget to approve a Treasury Department data collection plan intended to give insight into the depth of the insurance crisis.
The data collection plan, put forth by the U.S. Department of Treasury’s Federal Insurance Office, would require major insurers to provide key data detailing the impacts of climate change on property and casualty insurance across the country.
“As the costs of climate change pile up, insurance providers have protected their bottom line by reducing coverage and closing their businesses in some states,” said Carly Fabian, insurance policy advocate for Public Citizen’s Climate Program. “When insurers leave, the impacts hit marginalized communities the hardest, jeopardizing homes, life savings, and local economies. There is no timely, nationwide neighborhood-level data to show where the largest issues exist, leaving both local officials and federal financial regulators in the dark on potential systemic risks to our entire economy. As climate change gets worse, we need a complete understanding of where communities are most at risk, and this requires transparent access to data.”
In the letter sent to the Office of Management and Budget, the groups underscore the vital need for a nationwide study of the impact climate change is having on insurance markets. After FIO originally proposed this collection last year, the National Association of Insurance Commissioners (NAIC) also announced it will work with states on similar collections, but it remains unclear whether or when these NAIC data collection plan may be implemented and how many states would participate.
“A data collection plan from NAIC is a welcome sign that states are now feeling the pressure to collect data, but we cannot afford to wait for each state’s insurance regulators to decide if and when they want to provide data. We need a nationwide collection,” said Fabian. “The Treasury Department has a mandate to collect and analyze data and monitor impacts on low- and moderate-income, minority, and traditionally underserved communities. Approving this call for data is only the first step toward taking action to protect consumers and the entire financial system from systemic risks caused by climate impacts to insurance providers.”
The Office of Management and Budget is now considering the Federal Insurance Office’s Climate-Related Financial Risk Data Collection, which was finalized by the Treasury Department in early November. With approval from OMB, insurers will be expected to submit the completed data collection form to FIO within 90 days of final publication of a notice announcing the start of the data collection plan.
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